Many manufacturers use returnable or reusable containers to facilitate the flow of parts for the manufacturing process. The containers are used to transport parts from suppliers' facilities to the manufacturer's facility. Once the full containers that have been received from the suppliers are unloaded, they are typically transported to a returnable container center (RCC) at or near the manufacturer's facility where they are prepared for shipment back to the suppliers. The suppliers then reload the containers with parts and the full containers are transported to the manufacturer's facility.
Different types of containers are allocated to suppliers based on the type of parts that each supplier produces and delivers to the manufacturer. Some supplier's may require “specials” (e.g., specially adapted containers) while others may use “generics” (e.g., modular totes, pallets, or racks). Most of the containers may be used interchangeably by many of the manufacturer's suppliers. It is not necessary for each supplier to have a dedicated set of containers of a particular type. As along as the supplier receives containers of a suitable type for transporting the parts to the manufacturer's facility, any set of containers of that type may be shipped to the supplier for packaging the parts.
Allocation of containers to suppliers is often accomplished as follows. A manufacturer may operate a RCC at the manufacturer's facility where the containers (e.g., modular totes, pallets, racks, etc.) are pooled. A monthly forecast is used to generate a daily average for allocation of containers to each supplier. Each supplier's allocated quantity is based on full production days for the month (daily average allocation×number of full days). This quantity represents the supplier's proposed inventory of containers. Part receipts at the manufacturing facility (e.g., based on review of part supply orders) are used to reduce each supplier's inventory. Shipped quantities (based on the supplier's allocated quantity) are immediately moved into the supplier's inventory after RCC loads the truck with the supplier's allocation of containers. As a result, the container inventory is only visible in relation to the supplier and is only an estimated quantity at the RCC.
For a manufacturer with multiple facilities, each RCC facility may be using a different calculation to allocate container shipments to suppliers. For example, one facility may use estimated quantities based on the daily average allocation and number of full days as explained above and a spreadsheet program to track estimated and actual quantities. Other facilities may use a special computer program. In some instances, however, no computerized tracking may occur so the manufacturer's associates simply guess what each supplier's requirements will be. The guess may not be as accurate as the estimated quantity based on the daily average allocation and number of full days. Finally, a manufacturer's facility may choose to return to a supplier every container that it receives from the supplier on the assumption that the supplier will require the same number of containers that it used for the previous shipment.
None of the methods that are currently used support automated and accurate allocation and tracking of containers. More importantly, they do not result in allocation of containers according to the supplier's needs as they relate to the manufacturer's actual production needs. The calculation method of allocation based on averages instead of actual production needs results in an over allocation of containers to suppliers who may not need them and an insufficient allocation of containers to suppliers who may need them. The monthly averages do not account for fluctuations in daily demand for parts that may occur in the actual production schedule.
Furthermore, there is no accountability for shipped or mis-shipped quantities from the manufacturer's RCC. There is no visibility of inventory movements or verifications to or from the supplier, internal to the manufacturer, or in-transit. Finally, there is no visibility to the entire system inventory across manufacturing. Although attempts may be made to rely on data in part supply orders, the order data does not always reflect the actual container types shipped causing further errors. In addition, there is no supplier visibility to allocated quantities. Inaccurate allocation quantities are sent to suppliers causing inventory buildup at the suppliers' or the manufacturer's facilities.
Failure to allocate and track and therefore, maintain an adequate inventory of containers may be costly to the manufacturer, especially when the manufacturer owns the containers and must account for costs associated with use of the containers. If the manufacturer maintains a container inventory that is too low to meet the needs of the suppliers (and therefore meet its production schedule), costs may increase because production is delayed as the manufacturer waits for parts. If production delays result from an improper allocation of containers, the manufacturer may choose to order more containers (often at a higher cost because the order must be expedited) in order to get the parts in a timely manner. If the manufacturer maintains a container inventory that is too high, it simply wastes money by storing and maintaining more containers than are really needed. Therefore, there is a need for a returnable container management system and method that supports the allocation and tracking of containers according to a manufacturer's production needs.